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Technology Stocks : Dell Technologies Inc. -- Ignore unavailable to you. Want to Upgrade?

To: D.J.Smyth who wrote (161380)	10/2/2000 3:52:57 PM
From: kaka	Respond to of 176387

Darrell, Re: trading at 23 X forward 12 month earnings. when was the last time Dell was trading at 23 X forward earnings? So that makes DELL highly undervalued, but to most, still not a good buy. No room for logic in the markets treatment of DELL. You would think all bad news is built into the price, but I agree with RD; if DELL missteps even slightly, the stock can go to 20 or lower. And lets say DELL does have a good quarter with tracking towards 30 % revenue growth for the year, will that be enough to rebound a broken stock back up to 51 (close on Dec 31 1999), or 35% up to 40 in the short term? Logic says it should, but I'm not counting on it. Why do I get the feeling that there will be bad omens coming from management at the analysts meeting? Kaka

To: D.J.Smyth who wrote (161380)	10/2/2000 4:45:39 PM
From: GVTucker	Respond to of 176387

Darrell, RE: when was the last time Dell was trading at 23 X forward earnings? For all of 1997, DELL was less than 23x forward earnings. For about half of 1998, DELL was less than 23x forward earnings.

To: D.J.Smyth who wrote (161380)	10/2/2000 9:26:55 PM
From: Meathead	Read Replies (1) \| Respond to of 176387

Here's how to get the stock price up. Dell needs to spin off the desktop division. Current shareholders will get .316 series D shares and .684 series E shares for every Dell share owned. This is based on .95 in earnings where desktops earns .30 and enterprise earns .65 per year Series D shares are a desktop company with 16B in annual revenue, 10% growth rate, and .30/share in earnings. What's that worth? With a PE of 20, about $6. Series E shares are an enterprise company also with 16B in annual sales but has a growth rate of 57% and about .65/share in earnings. What's that worth? Probably more than Sun or Cisco's PE but we'll give it a conservative PE of 2X growth at 114. That's $74. (74.684)+(6.316) = $52.50/shr No telling how high the street might bid up a company with 16B in annual revenue growing at 57% per annum. Amazing how the sum of the parts can be worth more than the whole. Go figure. MEATHEAD